Increasing Peru Tourism: Inkaterra Marketing Case Study Analysis

This case study examines Inkaterra's marketing challenges and opportunities within the Peruvian tourism sector. The analysis focuses on the company's marketing strategies and their effectiveness in driving tourism demand. The study investigates issues such as ineffective marketing management, strategic management deficiencies, and problems related to international business expansion. It applies various marketing and strategic management models to analyze the issues and propose solutions. The research explores the changing customer buying behavior and the need for Inkaterra to adapt its strategies to remain competitive. The study provides recommendations for Inkaterra to effectively use marketing strategies and increase tourism in Peru, including suggestions for addressing issues in international expansion. The study uses a structured approach, including an introduction to the research problem, case brief, problem statement, analysis and findings, proposed solutions, and future applications of the results, providing a comprehensive overview of the tourism and marketing challenges faced by Inkaterra.

To increase the demand of tourism
in Peru by using effective marketing
strategies: A case study analysis of
Inkaterra

ACKNOWLEDGEMENT
I am thankful to all those individuals who have provided guidance and assistance as well
to accomplish the dissertation. Firstly, I owe my thanks to mentor who gave me chance to
undertake this dissertation and motivate me to do it in ethical manner. Furthermore, I am
thankful to my team members, family and friends who helped me in all possible settlements.
This leads successful finishing point of dissertation and achievement of meaningful results.

ABSTRACT
In the contemporary ear, hospitality industry is growing very fast. It this situation it can
be said that when an industry grow with exponential rate then the organizations of that sector
start of face competition and same thing has found in the present research. The following study is
based on to increase the demand of tourism in Peru by using effective marketing strategies by
Inkaterra. The entire investigation has based on secondary research where different types of
models related to international marketing, strategic management and international business has
taking into the consideration. The reason of applying all these frameworks is because Inkaterra
has various kinds of problems related to marketing. Application of 9 models have helped in
analysing the issues of the organization and find the solution of those to minimize the impact on
the business operations. Along with this, it has also explored that Inkaterra has used lower
pricing and profit level strategies to increase the sales of the services. From the case study, it has
found that the buying behaviour of the customers have changed with the time. At last in the
investigation, it has been some recommendations have also given with respect to Inkaterra so
that organization can effectively use marketing strategies and increase demand of tourism in
Peru.

TABLE OF CONTENTS
ACKNOWLEDGEMENT...............................................................................................................2
ABSTRACT.....................................................................................................................................3
CHAPTER 1- INTRODUCTION....................................................................................................1
Background of the study.........................................................................................................1
RESEARCH PROBLEM (MARKETING MANAGEMENT OF INKATERRA, LOW
DEAMND OF TOURISM IN PERU, INTRENATIONAL BUSINESS OF INKATERRA)........2
RESEARCH QUESTIONS.............................................................................................................3
RESEARCH AIM AND OBJECTIVES:.........................................................................................3
STRUCTURE OF CASE STUDY ANALYSIS:.............................................................................3
CHAPTER 2 - CASE BRIEF..........................................................................................................1
Description of the situation....................................................................................................1
Scope of the study..................................................................................................................3
Chapter 3: Problem statement and plan of analysis.........................................................................1
Marketing management problem of Inkaterra and models.....................................................1
Tourism and hospitality strategy in global market place of Inkaterra and models................6
International hospitality Management of Inkaterra and models.............................................9
Research Methodology.........................................................................................................13
CHAPTER 4: ANALYSIS AND FINDINGS...............................................................................17
CHAPTER 5: PROPOSED SOLUTIONS TO PROBLEMS/ RECOMMENDATIONS AND
LIMITATIONS OF THE ANALYSIS..........................................................................................31
Solutions...............................................................................................................................31
Recommendations................................................................................................................37
Action plan...........................................................................................................................38
Limitations............................................................................................................................39
Implication............................................................................................................................39
CHAPTER 6: FUTURE APPLICATION OF RESULTS.............................................................40
About Hilton Hotels and Resorts Group..............................................................................40
Application of models on the identified problems on Hilton Hotels and Resorts................42
TRANSFER OF LEARNING.......................................................................................................52
REFERENCES..............................................................................................................................55

LIST OF ILLUSTRATION
Illustration 1: Structure of case study analysis................................................................................4
Illustration 2: Sales performance of Inkaterra Financials in 2011...................................................2
Illustration 3: Gross income of Inkaterra Financials in 2011..........................................................3
Illustration 4: Research Problem and relevant models....................................................................1
Illustration 5: SWOT analysis.........................................................................................................2
Illustration 6: Online marketing strategies......................................................................................4
Illustration 7: Core Competence model...........................................................................................5
Illustration 8: Porter’s Generic Strategies model.............................................................................7
Illustration 9: PEST Analysis..........................................................................................................8
Illustration 10: Value chain analysis model.....................................................................................9
Illustration 11: Porter’s five force model.......................................................................................10
Illustration 12: CAGE framework.................................................................................................11
Illustration 13: Foreign Market Entry Modes................................................................................13
Illustration 14: SWOT analysis of Inkaterra.................................................................................17
Illustration 15: Marketing issues faced by Inkaterra.....................................................................19
Illustration 16: Porter's Generic Strategies Model of Competitive Advantage for Inkaterra........21
Illustration 17: PEST analysis of Inkaterra....................................................................................23
Illustration 18: Porter’s Five Forces Model of Inkaterra...............................................................26
Illustration 19: CAGE Framework of Inkaterra.............................................................................29
Illustration 20: Foreign Market entry issues faced by Inkaterra....................................................30
Illustration 21: PEST analysis of Hilton Hotels and Resort (Source : Tribe, 2015)......................44
Illustration 22: BCG Matrix for Hilton Hotels and Resorts..........................................................50

CHAPTER 1- INTRODUCTION
Background of the study
Inkaterra can be determined as a sustainable tourism institution which was founded in the
year 1975. This organization provides different types of travel services and develops packages
which helps in attracting customers (Thqerle and Soto, 2015). In addition to this, cited firm has
rain-forest in Amazon of stewardship over 17,000 hectares located at south east Peru. Moreover,
in urban area of Maachu Picchu Historical sanctuary it has 10 hectares of cloud forest. In the
year 2011, cited firm received about 100,000 visitors at its hotels and restaurants. In addition to
this, there are about 500 employees and has served over 900,000 travellers (Collantes and
Martel, 2015). In addition to this, there are few of the things for which cited firm is devoted and
it includes protecting the culture and diversity of Peru. Conservation and preservation of
sustainable tourism in Peru. Focusing on providing visitors with memorable experience. In order
to grow, it is very important for any organization to provide its customers with high quality
service and in accordance with Inkaterra do focus on their services and help their travellers to
develop memories and experience (Abraham, 2012).
In this respect, there are three types of issues identify from the given case study of
Inkaterra which are ineffective marketing management, poor strategic management and problems
faced during the international expansion of business. In this context, marketing management and
strategic management both are important factor for the success of an organization (Candela and
Figini, 2012). With the application of both of these, it becomes easier to gain competitive
advantages in the marketplace. Along with this, the future planning relating to promoting the
services in the market place also based on both marketing and strategic management tactics. In
the case of Peru, the ineffective marketing strategies have deceased the demand of travel and
tourism at cited location. Along with this, the lack of cost leadership style and other issues, the
strategic management of Inkaterra has also failed to attract more and more travellers across the
world (Casprini and et. al., 2016). So, to increase the demand at cited destination, it is more
important for the organization to change marketing strategies and adopt different types of
solutions to attract more customers. On the other hand, with the application of various kinds of
strategic models, the reasons behind poor strategic management can be easily resolve. In this
context, various kinds of problems has to solve by Inkaterra at the time of expansion of business
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at international level. For this, company has required to adopt some strategies that can resolve
business expansion problems in more effective manner (Cooper, 2013).
RESEARCH PROBLEM (MARKETING MANAGEMENT OF
INKATERRA, LOW DEAMND OF TOURISM IN PERU,
INTRENATIONAL BUSINESS OF INKATERRA)
In accordance with the current study, the main issue is that the Peru which is the 3rd
biggest kingdom in South America. There are many beautiful place in Peru in which can be
effectively used in order to increase tourism but the main issue is that the travel and tourism
agency are not able to make use of effective marketing strategies with the help of which they will
be able to increase tourism (Glanz, Bader and Iyer, 2012). As the cited country has about 1.28
million square kilometres and half of the country is covered with water. With this respect, it is
very important for the organization to make sure that they provide proper information to their
potential customers. In this context, the research problem is regarding making use of different
types of marketing strategies which will be helpful in providing proper information to travellers
(Hallbäck and Gabrielsson, 2013). In this context, there are different types of marketing
strategies which can be adopted by Inkaterra and they will be able to increase tourism in Peru.
People prefer to visit those places which fulfil their needs and requirements and a place where
they will be able to enjoy their holiday. It been 41 years since Inkaterra has been established
however it has not been able to develop a great impact over the customers mind. This type of
issue is because of lack in use of marketing strategies. By using marketing strategies, firm will be
capable to increase their perception among customers mind (Green, Whitten and Inman, 2012).
Peru has high potential of increasing its customer’s base as there are many beautiful spots which
is very effective in attracting customers. In this context, Inkaterra have to develop awareness
among the various place and this can be done effectively with the help of making use of different
types of marketing strategies (Glanz, Bader and Iyer, 2012). Further, there are many
organizations which provide similar types of services like Inkaterra but it is very important for
the cite firm to make use of different strategies through which they will be able to attain
competitive advantages and this is very helpful in developing positive perception among
customers mind towards the services which are been provided by Inkaterra.
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RESEARCH QUESTIONS
Marketing management of Inkaterra1. What are the necessary changes in marketing strategies of Inkaterra which can increase
the demand of tourism in Peru?
Tourism and hospitality approach in global market place of Inkaterra2. What are the major reasons behind failure of tourism and hospitality approach in
international market place of Inkaterra?
International hospitality Management of Inkaterra3. What are the major problem of Inkaterra for expending its business at international level?
RESEARCH AIM AND OBJECTIVES:
Aim
To increase the demand of tourism in Peru by using effective marketing strategies: A case
study analysis of Inkaterra.
Objectives:
 To make necessary changes in marketing strategies of Inkaterra which can increase the
demand of tourism in Peru?
 To determine the major reasons behind failure of tourism and hospitality approach in
international marketplace of Inkaterra.
 To identify the major problem of Inkaterra for expending its business at international
level.
 To suggest appropriate strategies for growth and development of tourism industry of
Peru.
STRUCTURE OF CASE STUDY ANALYSIS:
For analyzing the give case study researcher will follow a systematic structure which will
comprise different chapters. These chapters will helps in understanding research problem and
getting appropriate solution to resolve this problem in effective manner (Hollensen, 2015).
Structure of this case study analysis will be based on research process and different chapters of
this analysis will be based on stages of research procedures. These stages are understanding
research subject and given case study, identifying research problem, collecting facts and figures,
analyzing collected data, interpretation and analysis of findings, making conclusion and
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suggesting appropriate strategies for resoling research problem (Wilson and Gilligan, 2012).
Therefore, in the basis of this research process author will follow the following structure of the
case study analysis:
Illustration 1: Structure of case study analysis
 Chapter 1- Introduction: It will provide a short explanation of the entire case lessons
analysis of Inkaterra and Peru. It will include a background study of growth and
development of tourism industry of Peru (Moutinho, 2011). Along with this, it will also
include historical information about the marketing strategies of Inkaterra. Further, it will
include aim, objectives and research question of the current case study analysis.
Afterwards, introduction chapter will also comprise stature of the entire case study
analysis which will be followed by researcher for resolving research problem. It is
considered as one of the most significant chapter which provides base to the entire
research. Apart from this, it provides idea to the readers regarding the topic being
selected for conducting research and is fruitful in every possible manner (Ferrell and
Hartline, 2010). The key areas covered in the introduction chapter involves aim and
objectives of the study which are most crucial and highlights the main reason behind
conducting research in appropriate manner. Apart from this, without setting appropriate
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aim it is not at all possible to conduct research in appropriate manner. On the basis of aim
of research other type of tools are decided which have to be considered for undertaking
research. Chapter 2- Case brief: After determining research problem author will include a brief
discussion about the given case study (Sheth and Sisodia, 2015). In which, it will include
tourism issue of Peru and scope of the growth and development. Along with this, it will
also include current situation of Inkaterra. Therefore, a brief introduction of whole case
study will be described in this chapter which will help in getting appropriate insights to
understand research problem by which study can apply appropriate methods to get
appropriate solution of it. In this chapter the major issues provided in the case have been
highlighted. Further, it is also regarded as one of the most significant chapter where
tourism issue faced in Peru has been undertaken which is directly acting as hurdle in
overall growth and development (Figueiredo and et. al., 2016). Apart from this, for
analysis purpose various tools have been applied in the study which have supported in
accomplishment of desired aims and objectives. Moreover, this case is also associated
with present situation of Inkaterra which needs to be considered for conducting the entire
study in appropriate manner. Chapter 3- Problem statement and analysis plan: After identifying research problem
study will frame a problem statement of the entire case study. This statement will also
describe different issues such as existing issues of tourism industry of Peru, methods
which are used by this nation for resolving these issues (Mudie and Pirrie, 2012). After
that it will also shed light on different methods by which this problem can be easily
resolved. Along with this, study will also develop appropriate data analysis plan for
resolving research issue in effective manner. It will include appropriate tools and
techniques for examine details and information. For the current case study instigator will
utilize both qualitative and quantitative methods of data analysis for examining collected
data and getting suitable solution (Gay, Mills and Airasian, 2011). Chapter 4- Analysis and findings: after data analysis this chapter will include
appropriate findings and results by which Peru can improve the growth and development
of tourism industry (Meffert, 2013). Along with this, it will also suggest appropriate
marketing strategies of Inkaterra by which this destination can raise the demand of
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tourism. For analyzing the findings, various methods will be use so that objectives of the
present investigation can be achieve in very more appropriate manner. Chapter 5- Conclusion and recommendations: On the basis of the findings of the
collected information, final conclusion and appropriate recommendations as per the
research objectives will be included in this chapter.
 Chapter 6- Future application of results: This chapter will include description and scope
of the future research. It will include brief discussion about the significance of the current
study for future investigation (Mullins, Walker and Boyd, 2012).
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CHAPTER 2 - CASE BRIEF
Description of the situation
As per the given case scenario Peru is 3rd biggest nation in South Africa and its
geographical area is 1.28 kilometres. Its population is 30 million which includes mix of
Amerindians, Europeans, Africans and Asians (Lee and Carter, 2011). One of the major
attraction of this country is the availability of the high natural resources. Along with this, it is
one of the biggest manufacturer of gold in Latin America and one of the main creators of Silver,
tin, copper, lead and zinc. But there are some other drawbacks also such as poor infrastructure
and limited foreign investment, etc. Along with this, its economic position is not as strong as
compare to the other developing countries. Peru is known as “export led” and it is the major
reason behind the growth of the nation. In terms of tourism and environment Peru has strong
potential to become a most visited country in the world because still there is a huge scope of
increasing attraction of customers towards the major attractive points of Peru (Philip, 2016).
As per the given case information UNESCO has declared that Peru has unparalleled
culture, environment and bio-diverse. So, all these factors decline the attraction of tourists.
Along with this, given information has also reflected that there are number of other aspects
which can influence the demand and supply of tourism services (Cant, 2011). In terms of
demand aspect of lack of marketing and advertisement of Peru and its tourist destination is the
major reason by which demand of the tourism services does not raise. In terms of lack of supply
of tourism services given information has reflected that lack of transportation, blockade to entry
for the new business and low involvement of the local people are the major reason behind them
most of the tourists organizations cannot provide appropriate tourism services to all tourism.
Therefore, study has described all the major problems associated with the Peru (Sharpley and
Telfer, 2014).
Along with this, case study has also included information about Inkaterra which is a
sustainable tourism institution and eco-pioneer. It is hotel developed and operators which
provides responsible travel services to all tourists (Wang, 2011). Major mission of this
organization is protecting natural resources and environment of the nation and enrich the rural
communities of the country. As per the given case study there are number of problems which are
facing by Inkaterra which affects the economic position of the organization and tourist industry
of Peru. Marketing strategies of Inkaterra were not as appropriate for increasing demand of
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